Cape Town - The Public Investment Corporation (PIC) decided to invest in Independent Media to give black people a chance to create a second Naspers [JSE:NPN], said the corporation’s CEO Daniel Matjila during a parliamentary briefing.
The Standing Committee on Finance requested the PIC, which manages among other things the Government Employees Pension Fund, to explain its investment mandate and rationale.
The PIC invests in various listed and unlisted companies. Its shareholding in Independent Media falls under its unlisted investments.
During question time, DA MP David Maynier asked the PIC why exactly it decided to help finance the Sekunjalo Consortium’s acquisition of Independent Media. “This investment seems a bit like investing in a horse and cart when the Ford model T comes onto the market,” Maynier said.
According to reports, the PIC acquired a 25%-stake in Independent Media, while Sekunjalo’s majority share had been largely funded by the PIC.
Maynier also wanted to know what amount Sekunjalo owes the PIC.
Matjila couldn’t provide the exact amount of the outstanding loan to Sekunjalo, but undertook to provide the information at a later stage.
He said the reason for supporting the Consortium was to bring back Independent Media, which had been owned by Irish shareholders, into South African hands. “We can therefore ensure that the company would be utilised for the benefit of the South African economy.”
Matjila said the reason for investing in Independent Media was not because of the advertising revenue. “The focus was to digitalise the company (similar to what Naspers had done).”
“This is what they (Independent) are doing at the moment. Naspers is the biggest company on the JSE. It used to be known as a company that burnt cash. It’s only fair to give blacks a chance to create a Naspers. The strategy is working now and the numbers look good. But we need to have some patience with the investment,” Matjila said.